tv Boom Bust RT April 16, 2019 1:30pm-2:01pm EDT
this is boom bust broadcasting around the world and covering the world of business and finance and impact upon us all i'm daniel britto in washington d.c. welcome to our theme show on one of our favorite subjects cryptocurrency the hybrid offspring attack and finance that is moving markets will have the co-founder of counterpart x christy i here to analyze kryptos and how to get started in the market plus r t correspondent trinity charges breaks down the a.b.c.'s a bit coin and the many crypto hacks we've seen in the past few years and later we'll be joined by henri arslan yon. and crypto leader for p w c n asia to talk about stability and volatility and crypto we've got a lot to cover today for both newcomers and virtual currency veterans so let's get right to it. the crypto currency market is on the verge of one more step toward normalization and regulation this time in the united kingdom the u.k. is financial conduct authority or f.c.a.
will table the question of crypto regulation early next year according to a top aide to the u.k. treasury minister economic secretary john glenn has reportedly responded to a september call for crypto regulation from parliament's treasury committee mr glenn wrote to m.p.'s quote the government will consult early next year to explore whether prieto assets have comparable features to specified investments but that fall outside the current perimeter should be captured in regulation mr gowan did signal that legislation would be required to implement the likely result of that consultation to ensure all necessary legal authority for f.c.a. to properly regulate the crypto currency market as crypto currency best crypto investors and boom busters no regulators have wrestled with how exactly to define crypto zone long existing categories of currency securities commodities or whether to create a new category. what better way to kick off the cryptocurrency
special than by analyzing the top crypto bitcoin in with the bitcoin one a one for those of us who still aren't quite sure how it works and the record if you were going to hand you over to our g. correspondent trinity john is one of the biggest financial stories of the past year has been the incredible rise and pullback of big corn but although many refer to it as a new type of asset or currency it's actually been around for the last decade and we're going to break down this crypto currency is history crypto currency is like bitcoin our currency is that allow people to pay child there without involving financial institutions they are sometimes called digital currencies or virtual currencies but we tend to call them crypto currencies and although bitcoin was the first established crypto currency there were previous attempts at creating other online currencies with ledgers and secured by encryption like the money and big gold but neither of the two were ever fully developed but for big it all started in two thousand and eight when this paper was posted to
a mailing list discussion on crypto graffy by someone or some group who goes by the name known as soto she not comodo who's really done it is still a mystery meanwhile in two thousand and nine bitcoin begins this is the year the software became available to the public for the very first time and mining starts later that year the new liberty standard published the first exchange rate between one dollar to be worth more than one thousand three hundred nine. now with the exchange rate established it was only a matter of time before someone would try to make an actual purchase and that happened in two thousand and ten when someone swapped ten thousand out there because for two pizzas but a few months later the penny threshold and that today's price is ten thousand vets quite often be worth more than sixty five million dollars and in two thousand and eleven and two thousand and twelve the silk road was created by ross albright who was known under the pseudonym as dread pirate roberts the web site was designed to use for. or and big corn and allowed people to buy and sell whatever they wanted as
long as they weren't hurting anyone else the widespread adoption of the coin and the invisibility of the dark web allowed silk road to quickly become the world's drug market place and dread pirate roberts to become one of the world's biggest drug kingpins in two thousand and thirteen he was arrested he is currently serving a double life sentence plus forty years without the possibility of parole meanwhile during that same time after steadily making gains was worth one dollar for the first time in two thousand and eleven by june of that year big quinn was worth over thirty dollars but then it took a hit and drop back down to ten dollars and that want to be the last time the prices took a hit over the next few years because it increases in popularity and after hitting the thousand dollar price value for the first time in two thousand and thirteen it quickly begins to decline and it would be around two years before the currency reaches a thousand dollars again because we've been stalled for a while and in january two thousand and fourteen and once again fell below one thousand dollars and struggle to rise for a few years during this time the world's biggest bitcoin exchange mt gox and japan
announced that around eight hundred fifty thousand points valued at nearly five hundred million dollars belonging to customers and the company had been stolen the company suspended trading and shut down however big would have its comeback in two thousand and seventeen this was the biggest and busiest year for the currency after spending two thousand and sixteen trying to make a comeback big queen finally reached and passed its one thousand dollar mark and by june it was worth over three thousand dollars six thousand dollars november nearly ten thousand dollars and by the end of december big quinn was worth nearly twenty thousand dollars but twenty eighteen has been a rough year for bitcoin the price has steadily dropped for much of the year and has been trading around the seven thousand dollar mark which is about a sixty five percent drop in value reporting in new york.
now after that one zero one one you may be wondering how to get started in crypto currency investing well now we will break down how to get a jump start in the market with kristie the co-founder of counterpart x. so it might be hard for folks to believe but there are more than sixteen hundred crypto currencies out there some of them with crazy nutty names a lot of with crazy nutty names but the question really comes to how do people actually invest how do they get into crypto currencies you've got a few ways to explain it for us all right so before investors actually tried a vest and one of the sixteen hundred quid coins they first need establish their base currencies now based currencies are currencies but quite a theory i'm like klein and big names we've all heard exactly those base coins can be purchased with currency regular money like u.s. dollars also the sixteen hundred cannot so they first need
a buy one of these basic points from a centralized exchange centralized exchanges are some name very familiar names such as crack and i think we've got a chart here these are these are exchanges that are located all over the world is a little complicated here but primarily where they based kristie yes so as you can see the in the yellow the majority of these exchanges are actually based in japan japan and u.s. dollars are the most frequently traded currencies right now and currencies and as you can see coin check bit flyer stamp and coin those are the dominant players within the exchange that you see like you say the the large amount of different currencies that are going into kryptos here we have japan so that is taking up a lion's share this is the u.s. in the light blue here and then that europe you know so even if you take there's china china here. so even if you take these together we're talking a lot of interest in asia then the us and then of course in the so
once you get one of these regular based coins like the coins or theory and then you can buy one of these other sixteen hundred all coins but that's going through one of these exchanges but there's a hook to exchanges right you don't actually own the bit going on or whatever it is explaining that you don't technically own it it's very similar to keeping your money at a bank yes you own an account with the bank but the bank holds your money so if anything were to happen to the bank such as the bank or there's a run on the bank your money is at stake and same with these crypto currencies these exchanges hold your crypto currency so they all own and hold your wallet you don't actually own it so if it or to say get hacked then your crypto currency will all get lost so that's why security is a very major factor when deciding which exchange to purchase if you want to own yourself we've got to go back to the other chart we've got other ways you can do it and that involves a digital digital wallet right at the other chargeback you're the second way to do
it and that's where you can actually have it and you only if you're so right explain that exactly so a digital wallet whether it be a software our hardware a wallet you own your own wallet which means you have to keep track of pascoe's and you actually hold and own your big point and and likewise coins so with that you have to first fill it with coins once you create a digital wallet there are many ways to do that you can actually withdraw money from the exchange and put it into a digital wallet directly or other ways you can do it is a peer to peer transfer you find someone who has a big point you pay them money such as yourself and you will send me back into my digital wallet another way. this is very popular and there's over two thousand a tense in the us over three thousand worldwide and it's very easy to find a big point a.t.m. as the maps are very readily available online so you can go to a site and get a digital wallet so if you're just yahoo. google digital wallets to eat their wallet is the most common in my area wallet is
a place people go and that'll take you through the steps and then you could give me your bank account information so be careful guys and you could actually then get crypto so that's the way you actually get it and then the last area explained as we talked about those all the time on the program explain additional coin offerings how you can get crypto out of those so initial coins offerings are very interesting if you want to invest in one of these it's very similar to an i.p.o. i.p.o. quite i.p.o.'s are stocks that aren't listed on an exchange yet similarly these coins are not listed on any exchange yet so if you are interested in a project and i see a foreign investment purpose then you would have to submit your base currencies that you previously bought in your crypto exchanges are a peer to peer transfers and send it to these icy offerings for an investment and one thing i always tell people and from my former regulatory hat on here be careful what are the main things people need to be careful of and watch out for kristie many thing that i see aucoin offerings as we know there are many i.c.'s there on the market and people have to do their research and be careful that it's
a real company and not a fraudulent company people really need to protect their passwords and pass codes because that's the only barrier stopping them from potentially being hacked and also for peer to peer transfers you really need to be aware of your car party and have trust in whoever has that they quite really is going to send it to you because there's no escrow service there's no repercussions in case you send them six thousand dollars and they don't send you a big point so until that problem gets solved people really need to be careful about who they trust and who they decide to engage in business with and just last thing for our viewers we're not telling you to get a bit coy always be careful where you put your hard earned money but if you want to do it this is how christie has been great explainer thank you christi thank you. time for a quick break but hang in here because when we return on we are slow or slow on your joins us to talk more about this the future instability of cryptocurrency and as we go to break. here are the numbers of the closing bell.
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currency will roll out in india and will first be used in money transfers and remittances within whatsapp which reportedly has two hundred million indian users of facebook s'posed the spokesperson would only confirm to bloomberg that the company is quote exploring ways to leverage the power of blogs and change technology effectively restating i'm a announcement that facebook formed a block chain applications team headed by former coinbase board member david markus the project will still take some time to develop and the report noted a number of failed attempts at stable coin launches in twenty eighteen and controversy around tether one of the more prominent survivors stable coins are an attempt to reduce the volatility which has plagued more conventional kryptos by linking the currencies value to a commodity or currency reportedly in this case the us dollar. and an unfortunate reality of crypto currency like any new tech field is the ever present threat of attacks crypto exchanges are often at risk of cyber attacks that
could rob investors on their assets to analyze the history of crypto hacks archies trinity child is back to break it down. there have been many hacks in the crypto world over the past few years whereas in many cases experts first took advantage of the weaknesses in the exchange of security structure leading to billions in the last five months in fact nearly a billion crypto was stolen this year alone so we're taking a trip down memory lane. breaking down some of the biggest crypto hacks and history and the metal for possibly the largest crypto currency hack in history goes to japanese crypto currency exchange coin check were approximately five hundred thirty million worth of them coins was stolen back in january according to fortune the currency was stolen from a hot wallet basically a wallet connected to the internet which allowed hackers to dream nemko points into a separate account the exchange admitted that its own sloppy security practices were to blame the incident led to its acquisition by mo next week japanese
financial group in april twenty eighth it took ten months for the dust to settle but then in november the exchange announced that it would resume trading services and how could we forget about mt gox yes the debacle that happened in two thousand and fourteen arguably the highest profile hack of all time but what's important about the mt gox hack was that it wasn't just a single instance that happened in just a few hours or even days according to documents released in two thousand and fourteen hackers had been skimming that point from the company for years mt gox launched its current exchange in two thousand and ten and in just four years the exchange grew to process more than seventy percent of the world's big trades but then in two thousand and fourteen it went offline after hackers stole an estimated eight hundred fifty thousand because the company blamed tacker then a security flaw for the lost but the company did however find two hundred thousand of those because a few weeks later then there was what some would call the biggest attack on a theory him to date in two thousand and sixteen funds were noticed to be leaving the decentralized autonomy organization and around three point six million ether
that was worth around seventy million dollars was stolen by a hacker in just hours the dow is still considered to be the biggest step of the theory m of all time meanwhile in february this year the italian crypto currency exchange big grill announced it had been hacked losing around one hundred ninety five million worth of nano the currency formally known as rail blocks today nano is considered to be one of the most disappointing crypto currencies of all time since it had decreased and value so my. as of december fourteenth the stock price stood at only around seventy seven cents last year crypto exchanges recorded around two hundred sixty six million dollars in losses from security breaches and heists and the first half of this year around seven hundred thirty one million dollars was reported stolen from crypto exchanges while there isn't just a long player answer on how to prevent crypto hacks all together investors in the crypto space are raising concerns regarding the standard of security measures that should be implemented by crypto trading platforms reporting
a new york trend of each other as r.t. . those markets continue to dramatically rise and fall could cryptocurrency be the proverbial island of stability in the world of finance for more burchill and sat down with henri arslan yun been taken cook to a leader in asia to enlist the stability and future of kryptos. henri you you speak with a lot of the same folks that are i speak with and and i've heard this analogy between crypto currency is which clearly had a bubble licious year last year with bitcoin rising at twenty k. and the dot com boom of the ninety's do you see a comparison there. the absolutely i think is a lot of similarities you know when we look at the dot com boom that took place obviously a lot of companies went bust but then you have some of the large technology players
in the big success stories that came out and frankly really transformed the way we live today and i really expect the same to take place in the crypto space for example when it comes to the i c o's today you know i think it's very normal that the majority of these i suppose may fail but however there will be some winners out of this group and these companies may change the with the world in ways that we can even the pacific today you know henri there are a lot of i c o o's and i speak with these folks all the time not not just on the air. we're on boom bust here but some of them that were thinking about trying to rush things out last year or do and i see oh are actually pretty pleased they did and they think that maybe you know some regulators would have their eye on them if they had raised all this money without per potentially doing all their dude diligence that sad some of that money may have dried up this year what are your thoughts about whether or not last year was the year to go i c.e.o. or it's better to have waited. now obviously it was you know it's very interesting
bart if you look at the data obviously last year was a record year for i see it was actually this year as well when it comes utility talk and i suppose the total day mounts rays are higher than last year that being said we're seeing really the market trend towards something we call security token . security token offerings which fall within the regulatory existing regular framework in many jurisdictions around the world yeah i want to talk a little bit about that about regulation you know you and i are sort of in the same place on crypto currency regulations that we you know that we've talked about it was before on read that we think some appropriate rules are needed but for the record and i know there are people out there probably screaming at their televisions and computers now some crypto enthusiasm disagree with that they hate it they hate folks like us who even suggest the government needs to be involved and i understand their view i just don't agree with it but you are the chair of the fin tech association in hong kong and i know you've been working and involved in helping the good folks over there that i spoke with last year at the hong kong
monetary authority to come up with some basic rules and they actually release on recently tell us about those. absolutely abarth i mean not a week goes by without any new regulatory changes i mean only if you look at the last week you know that people see in china they did maintain their bad and i suppose you had more issue as they came out with consultation of custody rules for crypto you know and you had tied for example that there would have come up with their new role. that there for a prove the first i see a portal but when it comes to hong kong that's probably where we had some of the most exciting developments for example with the hong kong regulator issued a new framework not only for crypto exchanges but also crypto funds and just to give you an example under the new framework and the crew license fund manager in hong kong and there's more than two thousand of them can hold up to ten percent of its portfolio in crypto us that's what of any additional licensing requirements and if it wishes to go over ten percent or actually make
a dedicated crypto fun it may do so of obviously there are certain restrictions with regard to type of investors they can have and or capital requirement or the type of policies on the risk evaluation they must take they need to have but it's obviously a very interesting development when it comes to cripple funds and this could continue to position hong kong as a leading asset management center not only for traditional us in management but definitely for crypto us at management as well but henri how do you how do you sort of split the baby as it were between too much and not enough regulation you know i probably i know that are are people that you and i both know enjoy brawl to or for example you know have a fairly low bar and then the us of course a pretty high bar you know how do you try to get that middle ground between not enough and too much regulation. that's an excellent question of art and it's actually very difficult for regulators to find the right level of regulation for
the crypto space not only because it's complicated but also the industry moves so fast but frankly i don't think the regulators get the credit they deserve i can tell that from my own personal experience the average regulator that i speak with is way more knowledgeable on crypto than the average senior banker for example and in many jurisdictions around the world we're seeing regulators take the initiative to come up with appropriate policies i mean europe you mentioned gibraltar does malta france recently is coming up with very interesting regulations in asia we have. thailand like hong kong and i expect many other jurisdictions to follow suit over the coming months and this is exactly what the cryptical system wants they want approved more clarity when it comes to the critical system and this is actually generally positive for the industry it reminds me when you say that they want more clarity right after the financial crash when i was at that commission a financial regulator after a while what the market participants said is just give us the darn rules i mean just tell us what the rules are we don't like i'm probably whatever they are but we
just want to know what they are so we can abide by them. i want to ask you one thing that may be an unfair question but you know we talked about krypto prices in the past where do you see them going perhaps in the next six months or maybe even through you know the first half of next year. you know say whatever believes they can predict the price of big chord must have a great sense of humor frankly the way i look at a critical crisis i think it's more of a destruction than anything else with a number that i really look at actually is a number of institutional players entering the space for example in recent weeks we had players like goldman sachs in the mirror on the banking side make their announcements of their plans on the crypto side and even on the asset management side you had players like fidelity announce what they how they want to service situational investors and. the investor side also some of the dallas from the u.s. announcing their critical investments and this is i think these are some of the developments i think are more important and frankly the price of crypto ossets and
on the long run will add more value to the i call system as we know what the brother cryptosystem on re are slain in the tech and crypto leader for asia henri thank you so much for your time. that's it for this sign thanks for joining us as we broke down the cryptocurrency market as always you can catch as catch boom bust on direct t.v. channel three twenty one dish network channel two eighty or streaming twenty four seven on pluto t.v. the free t.v. app or the channel one thirty two or hit us up on youtube dot. com slash. we'll see you next on.
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